Pfizer today hit back at criticism of its $106 billion (£62.5 billion) takeover bid for rival AstraZeneca, as David Cameron demanded more commitments from the US pharmaceuticals giant over British jobs and investment.
The proposed deal — which would be the largest-ever foreign takeover of a UK company — has come under attack from MPs over fears it will lead to job losses and damage Britain’s science industry.
But Pfizer, whose two approaches have been rejected by Astra, said the deal would speed up the development of new drugs and “bolster innovative science”. In an infographic posted on its website, it also quoted former GlaxoSmithKline boss Sir Richard Sykes, who has described the deal as a “fantastic opportunity” and said the bosses at Pfizer were “first-class people doing first-class research”.
However, Cameron — who last week received a letter from Pfizer chief executive Ian Read in which he promised to press ahead with Astra’s planned £330 million new headquarters and global research centre in Cambridge — today said he wanted further commitments.
Speaking during Prime Minister’s Questions, Cameron called criticism of his handling of the proposed merger as “extraordinary”, saying: “Our entire approach is based upon trying to secure the best possible deal in terms of jobs, investment and science.”
However, he declined to commit to applying a public interest test to the proposed takeover.
Business Secretary Vince Cable yesterday warned that the Government could intervene in the deal, and told MPs that the Coalition would not let Pfizer — which will gain huge tax savings by moving its domicile to the UK if the deal goes ahead — use this country as a tax haven.
Bosses from both companies have been summoned in front of MPs to discuss the deal. AstraZeneca has so far rejected Pfizer’s advances even though some of the company’s largest investors have called for them to open talks.
Analysts forecast that Pfizer will return with another sweetened bid. “We expect the recent flurry of noise coming from Government to provide relatively little of substance and expect a further bid to materialise in the coming weeks,” said Savvas Neophytou at Panmure Gordon.
Astra chief executive Pascal Soriot yesterday laid out his defence plan, promising that an independent Astra will nearly double its annual sales to more than $45 billion by 2023.
Neophytou said that Astra’s new projections imply a valuation eventually being reached of as much as £105 a share, adding: “We have set out relatively conservative assumptions which should make a bid of £55 per share easily achievable for Pfizer”.
Shares in AstraZeneca, which have risen more than a fifth since news of Pfizer’s interest emerged, today retreated 1.3% to 4617p, below the £48 at which the most recent offer — made up of cash and Pfizer shares — is presently valued.
